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Republic of the Philippines SUPREME COURT Manila EN BANC


&ERNANDO, J.: The failure of respondent Court of Industrial Relations to order the reinstatement of petitioners to their employment gave rise to this appeal by way of certiorari. The need for resort to this Court could have been obviated had there been no such marked inattention to the authoritative principle that a closed-shop provision of a collective bargaining contract is not to be applied retroactively for, at the time the decision was rende red on November , !"#$ and its affirmance by a resolution of respondent Court en banc on %anuary , !"#&, such a doctrine was controlling and did call for application. 'o it was indicated in the leading case of Confederated Sons of Labor v. Anakan Lumber and Co., 1 a !"#( decision. )s a matter of law then, the stand of petitioners is well-nigh impregnable. It would follow that their appeal must be sustained and respondent Court must be reversed. Three unfair labor practice cases for unlawful dismissal allegedly based on legitimate union activity were filed against respondent Central 'antos *ope+ Co., Inc. and respondent ,nited 'ugar -orkers ,nion-I*., with eight of the present petitioners as complainants in the first, 2 si/ of them in the second, 3 and five, in the third. - There was a consolidated hearing and a consolidated decision not only for convenience, but also due to there being hardly any difference as to the nature of the alleged grievance and the defense of management. There was no 0uestion about the e/pulsion from respondent

labor union of the former. In view of a closed-shop provision in the then e/isting collective bargaining contract, respondent Central 'antos *ope+ Co., Inc. assumed it had to dismiss them. 'o it was noted in the decision of the then associate %udge %oa0uin 1. 'alvador of respondent Court. Thus2 3The respondent company, in its answer, alleged that the only reason for the dismissal of the complainants herein is because their said dismissal was asked by the ,'-,-I*. of which union respondent company has a valid and e/isting collective bargaining contract with a closed-shop provision to the effect that those laborers who are no longer members of good standing in the union may be dismissed by the respondent company if their dismissal is sought by the union4 that respondent company has never committed acts of unfair labor practice against its employees or workers much less against the complainants herein but that it has a solemn obligation to comply with the terms and conditions of the contract4 and that a closed-shop agreement is sanctioned under this 5urisdiction for such kind of agreement is e/pressly allowed under the provisions of Republic )ct &$6 known as the Industrial 7eace )ct and the dismissal of complainants is merely an e/ercise of a right allowed by said law.3 . There was no 0uestion, however, as to petitioners having been employed by such respondent Company long before the collective bargaining contract, the first instance noted being that of Resurrecion 8ia+, who was in the service as far back as !" &4 / 'antiago 9a:e+, as far back as !" "4 7 8imas 9ocbocila, as far back as !";;4 8 'imeon 9ernil, as far back as !";64 9 )urelio )lamon, as far back as !";#4 10 <alentin =ui5arno, as far back as !";$4 11 9enito =uave+, as far back as !";&4 12 Raymundo )lamon, as far back as !";"4 13 >leuterio 9oblo, Nicolas )lamon, 'ofronio Conclara, )driano 9i:as and ?ederico 9os0ue, as far back as !"@$4 1Aerminigildo de %uan and Nicolas Casumpang, as far back as !"@&4 1. )gosto 7ulmones, as far back as !"@"4 1/ and ?eliciano 9elgira, as far back as !"6@. 17 In the decision of respondent Court, there was an acknowledgment of the prior e/istence of such employment relationship. Nonetheless, the conclusion reached, both by the trial 5udge and then by respondent Court en banc was that the dismissal was 5ustifiable under the closed-shop provision of the collective bargaining agreement. Aence, this petition for review, which, as noted at the outset, is impressed with merit. !. The authoritative doctrine that a closed-shop provision in a collective bargaining agreement is not to be given a retroactive effect so as to preclude its being applied to employees already in the service, is traceable, as set forth in the opening paragraph of this opinion, to the leading case of Confederated Sons of Labor v. Anakan Lumber Co. 18 decided in )pril of !"#(. In discussing the particular stipulation in the contract, it was made clear in the opinion of the then %ustice, later Chief %ustice, Concepcion2 3In order that an employer may be deemed bound, under a collective bargaining agreement, to dismiss employees for non-union membership, the stipulation to this effect must be so clear and une0uivocal as to leave no room for doubt thereon. )n undertaking of this nature is so harsh that it must be strictly construed, and doubts must be resolved against the e/istence of 3closed shop3.3 19 *ess than a year later, to be more precise, on %anuary &, !"#!, in Freeman Shirt Manufacturing Co.

!nc. v. Court of !ndustria" #e"ations, 20 this Court, speaking through %ustice =utierre+ 8avid, went further. Thus2 3The closed-shop agreement authori+ed under sec. @, subsec. aB@C of the Industrial 7eace )ct above 0uoted should however, apply to persons to be hired or to employees who are not yet members of any labor organi+ation. It is inapplicable to those already in the service who are members of another union. To hold otherwise, i. e., that the employees in a company who are members of a minority union may be compelled to disaffiliate from their union and 5oin the ma5ority or contracting union, would render nugatory the right of all employees to self-organi+ation and to form, 5oin or assist labor organi+ations of their own choosing, a right guaranteed by the Industrial 7eace )ct Bsec. ;, Rep. )ct No. &$6C as well as by the Constitution B)rt. III, sec. !D#EC.3 21 Thereafter, in $apisanan %g Mga Mangagaga&a %g A"ak v. Hami"ton 'isti""er( Compan( , 22 this Court, again speaking through the former, minced no words in characteri+ing a stipulation that would allow a dismissal of those already employed as 3null and void.3 23 In !"#$, this time already elevated to his position as head of the Court, Chief %ustice Concepcion in Sa"unga v. Court of !ndustria" #e"ations 2- did stress that while 3generally, a state may not compel ordinary voluntary associations to admit thereto any given individual, because membership therein may be accorded or withheld as a matter of privilege, the rule is 0ualified in respect of labor unions holding a monopoly in the supply of labor, either in a given locality, or as regards a particular employer with which it has a closed-shop agreement. ... .3 2. Ae continued2 3Conse0uently, it is well settled that such unions are not entitled to arbitrari"( e/clude 0ualified applicants for membership, and a closed-shop provision would not 5ustify the employer in discharging, or a union in insisting upon the discharge of, an employee whom the union thus refuses to admit to membership, without any reasonable ground therefor. Needless to say, if said unions may be compelled to admit ne& members, who have the re0uisite 0ualifications, with more reason may the law and the courts e/ercise the coercive power when the employee involved is a "ong standing union member, who, owing to provocations of union officers, was impelled to tender his resignation, which he forthwith withdrew or revoked. 'urely, he may, at least, invoke the rights of those who seek admission for the first time, and can not arbitrarily be denied readmission.3 2/ Nothing can be clearer therefore than that this Court looks with disfavor on a provision of this character being utili+ed as an e/cuse for the termination of employment. To complete the picture, mention should be made of )"egance !nc. v. Court of !ndustria" #e"ations, 27 where this Court, through the present )cting Chief %ustice 1akalintal, harked back to Freeman Shirt Manufacturing Co. !nc. v. Court of !ndustria" #e"ations 28 to stress the point of nonretroactivity. -hat should be immediately apparent, but unfortunately respondent Court seemed to have closed its eyes to it, is that when the decision was rendered by the trial 5udge on November , !"#$ and affirmed with the Court sitting en banc on %anuary , !"#&, the controlling doctrine to which deference ought to have been paid was that petitioners should not have been dismissed.

. Nor is there anything unusual in this CourtFs adherence with remarkable consistency to such a basic doctrine. The obligation was categorically imposed on the 'tate, under the !";6 Constitution, to 3afford protection to labor, especially to working women and minors ... .3 29 That is to carry out the purpose implicit in one of the five declared principles, namely, the promotion of social 5ustice 3to insure the well-being and economic security of all the people ... .3 30 It is then the individual employee, as a separate, finite human being, with his problems and his needs, who must be attended to. Ae is the beneficiary of the concern thus made manifest by the fundamental law. The present Constitution is even more e/plicit on the matter. The principle that the 'tate shall promote social 5ustice is categorically based on the concept of insuring 3the dignity, welfare, and security of all the people.3 31 Insofar as the provision on the 'tate affording protection to labor is concerned, it is further re0uired to 3promote full employment and e0uality in employment, ensure e0ual work opportunities regardless of se/, race, or creed, and regulate the relations between workers and employers. The 'tate shall assure the rights of workers to self-organi+ation, collective bargaining, security of tenure, and 5ust and humane conditions of work.3 32 -here does that leave a labor union, it may be asked. Correctly understood, it is nothing but the means of assuring that such fundamental ob5ectives would be achieved. It is the instrumentality through which an individual laborer who is helpless as against a powerful employer may, through concerted effort and activity, achieve the goal of economic well-being. That is the philosophy underlying the Industrial 7eace )ct. ;; ?or, rightly has it been said that workers unorgani+ed are weak4 workers organi+ed are strong. Necessarily then, they 5oin labor unions. To further increase the effectiveness of such organi+ations, a closed-shop has been allowed. ;@ It could happen, though, that such a stipulation which assures further weight to a labor union at the bargaining table could be utili+ed against minority groups or individual members thereof. There are indications that such a deplorable situation did so manifest itself here. Respondent Court, it would appear, was not sufficiently alert to such a danger. -hat is worse, it paid no heed to the controlling doctrine which is merely a recognition of a basic fact in life, namely, that power in a collectivity could be the means of crushing opposition and stifling the voices of those who are in dissent. The right to 5oin others of like persuasion is indeed valuable. )n individual by himself may feel inade0uate to meet the e/igencies of life or even to e/press his personality without the right to association being vitali+ed. It could happen though that whatever group may be in control of the organi+ation may simply ignore his most-cherished desires and treat him as if he counts for naught. The antagonism between him and the group becomes marked. 8issatisfaction if given e/pression may be labeled disloyalty. In the labor field, the union under such circumstances may no longer be a haven of refuge, but indeed as much of a potential foe as management itself. 7recisely with the )nakan doctrine, such an undesirable eventuality has been sought to be minimi+ed, if not entirely avoided. There is no 5ustification then, both as a matter of precedent and as a matter of principle, for the decision reached by respondent Court. ;. Now as to the remedy to which petitioners are entitled. Clearly, they should be reinstated with back pay. In Sa"unga v. Court of !ndustria" #e"ations, 3.

reinstatement was ordered but it was the labor union that was held liable for the back wages. That is a rule dictated by fairness because management, in this case respondent Central 'antos *ope+ Company, Inc., would not have taken the action it did had it not been for the insistence of the labor union seeking to give effect to its interpretation of a closed-shop provision. )s we decided then, so do we now. These words of the Chief %ustice in 'alunga carry persuasion2 3%ust the same, having been denied re-admission into the ,nion and having been dismissed from the service owing to an unfair labor practice on the part of the ,nion, petitioner is entitled to reinstatement as member of the ,nion and to his former or substantially e0uivalent position in the Company, without pre5udice to his seniority andGor rights and privileges, and with back pay, which back pay shall be borne e/clusively by the ,nion. In the e/ercise of its sound 5udgment and discretion, the lower court may, however, take such measures as it may deem best, including the power to authori+e the Company to make deductions, for petitionerFs benefit, from the sums due to the ,nion, by way of check off or otherwise, with a view to e/ecuting this decision, and, at the same time effectuating the purposes of the Industrial 7eace )ct.3 3/ -A>R>?.R>, the decision of respondent Court of November , !"#$ and the resolution of respondent Court en banc sustaining the same of %anuary , !"#& are hereby reversed. Respondent Central *ope+ Co., Inc. is hereby ordered to reinstate petitioners to the positions they occupied prior to their illegal dismissal, with back wages to be paid by respondent ,nited 'ugar -orkers ,nion-I*., deducting therefrom whatever wages they may have earned in the meanwhile. -ith costs against private respondents. Maka"inta" Actg. C.*. Castro +eehankee Makasiar Antonio and )sguerra **. concur. ,arredo *. took no part. -a"divar *. is on "eave.

! !($ 7hil. "!6. The eight complainants in Case No. &!-,*7-Iloilo now *- &$"!, are the following2 <alentin =ui5arno, Aerminigildo de %uan, Nicolas Casumpang, >leuterio 9oblo, 9enito =uave+, )rsenio %emena, 8imas 9ocbocila and Nicolas )lamon. ; The si/ complainants in Case No. &&-,*7-Iloilo, now *- &$" , are the following2 Ismael 9illones, Raymundo )lamon, 'antiago 9a:es, 'ofronio Conclara, )driano 9i:as and )urelio )lamon. @ The five complainants in Case No. &"-,*7-Iloilo, now *- &$";, are the following2 'imeon 9ernil, Resurrecion 8ia+, ?eliciano 9elgira, ?ederico 9os0ue and )gosto 7ulmones. 6 8ecision, )nne/ ) of 7etition, ;@. # !bid, $.

$ !bid, !". & !bid, !!. " !bid, (. !( !bid, !&. !! !bid, 6. ! !bid, #. !; !bid, !6. !@ !bid, &, ! , !;, !$ and @. !6 !bid, @ and ! . !# !bid, 6. !$ !bid, ;. 7etitioner )rsenio %emena did not specify his date of employment, and petitioner Ismael 9illones was not presented as a witness, but it would appear that no 0uestion as to their having been in the employment at the time of the collective bargaining contract could seriously be raised. !& !($ 7hil. "!6. !" !bid, "!". ( *-!#6#!, %anuary &, !"#!, ! 'CR) ;6;. ! !bid, ;6#. *-!&!! , .ctober ;(, !"# , # 'CR) ;#$. ; !bid, ;$ . Cf. ?indlay 1illar Timber Co. v. 7hil. *and-)ir-'ea *abor ,nion, *-!& !$ and *-!& , 'eptember ", !"# , # 'CR) $4 ,nited 'tates *ines Co. v. )ssociated -atchmen H 'ecurity ,nion, *-!66(&, %une ", !"#;, & 'CR) ; #4 National 9rewery H )llied Industries *abor ,nion of the 7hil. v. 'an 1iguel 9rewery, Inc., *-!&!$(, )ugust ;!, !"#;, & 'CR) &(64 7hil. 'team Navigation Co. v. 7hil. 1arine .fficers =uild, *- (##$ and *- (##", .ctober ", !"#6, !6 'CR) !$@4 Ri+al *abor ,nion v. Ri+al Cement Co., Inc., *-!"$$", %uly ;(, !"##, !$ 'CR) &6&. @ *6 !bid, # !bid, @6#, 'eptember $, !"#$, ! 'CR) !#. ;.

;. Cf. 'eno v. 1endo+a, *- (6#6, November ", !"#$, ! 'CR) !! @.

$ *- @("#, )pril (, !"$!, ;& 'CR) ;& . & *-!#6#!, %anuary &, !"#!, ! 'CR) ;6;. " )rt. II<, 'ec. #. ;( )rt. II, 'ec. 6 of the !";6 Constitution. ;! )rt. II, 'ec. # of the revised Charter reads in full2 3The 'tate shall promote social 5ustice to ensure the dignity, welfare, and security of all the people. Towards this end, the 'tate shall regulate the ac0uisition, ownership, use, en5oyment, and disposition of private property, and e0uitably diffuse property ownership and profits.3 ; )rt. II, 'ec. " of the revised Constitution. ;; Republic )ct No. &$6 B!"6;C.

;@ ) proviso in 'ec. @, par. BaCB@C reads as follows2 3That nothing in this )ct or in any other )ct or statute of the Republic of the 7hilippines shall preclude an employer from making an agreement with a labor organi+ation to re0uire as a condition of employment membership therein, if such labor organi+ation is the representative of the employees as provided in 'ection twelve, but such agreement shall not cover members of any religious sects which prohibit affiliation of their members in any such labor organi+ation.3 )s amended by Republic )ct No. ;;6( B!"#!C. ;6 *;# !bid, @6#, 'eptember $, !"#$, ! 'CR) !#. 6.